Inside Africa

7 min read

Why ecommerce business in South Africa is thriving

February 5, 2026

Why ecommerce business in South Africa is thriving

South Africa’s ecommerce sector has transitioned from a marginal component of the retail ecosystem to a central driver of commercial growth.

Over the past decade and particularly since the COVID‑19 pandemic, it has experienced structural expansion that outpaces traditional retail, redefines consumer behaviour, and reshapes the competitive landscape.

This article examines the factors fueling the growth of ecommerce business in South Africa, assessing market size and the role of digital infrastructure.

The scale and trajectory of growth

The most compelling evidence of the ecommerce boom in South Africa is market performance.

According to the Online Retail in South Africa 2025 report (produced by World Wide Worx in collaboration with Mastercard, Peach Payments and Ask Afrika), online retail turnover is projected to exceed 130 billion South African rand (approximately US$7.4 billion) in 2025, capturing nearly 10% of total retail sales nationally.

This follows an estimated 35% growth in 2024, when online retail reached R96bn, up from R55bn the prior year.

Ecommerce growth in South Africa has significantly outpaced physical retail expansion, which increased by only 2.5% in 2024 and 1.6% by mid‑2025.

These divergent performance trajectories indicate that digital channels are not merely complementary but are actively cannibalising and redefining conventional retail formats.

Longer-term projections also underline confidence in the sector: some industry forecasts anticipate e-commerce capturing 12% of total retail turnover by 2027, with online retail values exceeding R150 billion.

Structural drivers of ecommerce expansion

1. Digital Infrastructure and Internet Penetration

Internet usage is a foundational enabler of ecommerce. Statista estimates that over 76% of South Africans were internet users in 2023, a figure expected to grow significantly by the end of the decade.

Concurrently, the number of ecommerce users in the country is forecast to rise to 11.7 million by 2025, and potentially exceed 21 million by 2029.

Smartphone penetration and mobile‑first usage have been especially critical; data from ecommerce insights suggest that around 77% of online consumers shop via mobile devices, underscoring the mobile‑centric nature of South Africa’s digital retail environment.

This aligns with global patterns where mobile commerce accelerates access and convenience, particularly among younger and urban demographics.

2. Digital payments and financial innovation

Reliable, secure payment systems are essential to e-commerce adoption.

South Africa’s digital payments landscape has matured substantially, exemplified by investments like Visa’s first Africa data centre in Johannesburg, a strategic development aimed at enhancing digital transaction processing and financial inclusivity.

Mastercard and regional fintechs have also played pivotal roles in advancing digital commerce by facilitating seamless online transactions and reducing friction in checkout processes.

The trust engendered by secure digital payments has made online shopping more accessible and less risky for consumers, addressing one of the historical barriers to ecommerce adoption.

3. Logistics and delivery innovation

Efficient logistics are a core competitive advantage for ecommerce. South African retailers and platforms have invested heavily in fulfilment infrastructure.

Takealot, for example, operates major logistics hubs and in‑house delivery networks that underpin its next‑day delivery promise and widened geographic coverage.

Similarly, rapid‑delivery applications like Checkers Sixty60 have gained traction, reporting substantial growth (nearly 47% in the first half of 2025)and illustrating how logistics innovation is expanding e-commerce beyond traditional boundaries into rapid grocery delivery and last‑mile fulfilment.

Consumer behaviour and market dynamics

1. Expansion across categories

The composition of e-commerce demand in South Africa has diversified. Early adopters were predominantly electronics and media products, but recent data show significant penetration in groceries, fashion, health, beauty, and homewares.

For example:

Grocery retail, driven by on‑demand platforms, has become a central growth vector.
Fashion and lifestyle segments are also expanding rapidly, with retailers like Woolworths reporting substantial online sales growth.

These trends reflect broader shifts in consumption habits, with consumers increasingly comfortable purchasing essential and discretionary items online.

2. Demographic shifts in online shoppers

Consumer behaviour data indicates that South African ecommerce is predominantly driven by the 25–54 age demographic, who account for the majority of online purchasing activity.

Urban centres like Johannesburg and Cape Town are hotspots for online engagement, but increasing internet penetration is extending ecommerce penetration into secondary cities and peri‑urban areas.

Mobile usage patterns, combined with growing familiarity with digital platforms, are shifting purchasing habits.

Social commerce (via platforms such as Instagram, WhatsApp, and TikTok) is increasingly integral to discovery and checkout pathways, potentially accounting for a significant share of future online sales.

Competitive forces: Local and global

South Africa’s ecommerce market features a mix of strong domestic players and increasing global participation.

1. Local platforms and market leaders

Takealot remains the market leader by share, leveraging robust logistics, technology investments, and marketplace growth. Other established players such as Shoprite’s Checkers Sixty60 and Woolworths’ ecommerce divisions have also contributed to the sector’s vibrancy with category‑specific innovations in grocery and lifestyle products.

2. Global entrants and competitive pressure

The entry of global giants like Amazon has added competitive intensity.

After launching its South African platform in 2024, Amazon expanded its offerings to include groceries, pet food, and health supplements, further validating the market’s growth potential.

Meanwhile, cross‑border platforms such as Shein and Temu have achieved notable online penetration, particularly in the apparel segment, albeit with regulatory constraints affecting their cost advantage.

This blend of local incumbents and international competitors has stimulated innovation, diversified consumer choices, and encouraged price and service competition, key factors in market maturation.

Challenges and structural barriers

Despite strong growth, South Africa’s ecommerce ecosystem faces persistent challenges.

1. Regulatory and cost constraints

Cost structures relating to data pricing and internet accessibility remain a concern for broader digital inclusion. High data costs relative to incomes can constrain ecommerce participation, particularly among lower‑income groups.

Furthermore, foundational legal frameworks governing digital commerce may need reform to support cross‑border trade, protect consumer rights, and incentivise local SMEs to scale online.

Regulatory asymmetries that favour large cross‑border platforms over local businesses have been identified as a hindrance to deeper sectoral development.

2. Infrastructure and digital divide

While urban connectivity is relatively robust, disparities persist in rural and peri‑urban areas. These gaps in internet access and digital literacy limit the full extension of ecommerce’s benefits across the broader population, a challenge common to emerging markets but especially pronounced in Africa’s most industrialized economy.

Economic implications and future outlook

Ecommerce’s rapid ascent is not merely a retail phenomenon, its broader economic implications are significant.

1. Retail sector transformation

The structural realignment of retail toward online platforms has implications for employment, commercial real estate, and supply chain configurations. Physical retail formats face mounting pressure to integrate omnichannel strategies to retain market share. Ecommerce innovation has become a strategic imperative, not a peripheral option, for legacy retailers.

2. SME inclusion and export potential

Online platforms create opportunities for SMEs to access national markets at scale, circumventing some traditional barriers to entry. With appropriate policy support and infrastructure, South African businesses could leverage ecommerce to expand into regional and global markets.

Industry commentators have highlighted the potential for ecommerce to unlock broader export opportunities, potentially exceeding R1 trillion in value, if structural constraints are addressed.

3. Broader digital economy growth

The growth of e-commerce is intrinsically linked to the wider digital economy, encompassing fintech, logistics tech, data analytics, and cloud services. Continued investment in digital skills, infrastructure, and regulatory frameworks will be crucial to maintaining momentum and ensuring that e-commerce contributes substantively to inclusive economic growth.

Conclusion

South Africa’s ecommerce sector is thriving due to a confluence of structural, technological, and behavioural dynamics.

Rapid growth in online retail sales, expanding internet and smartphone penetration, secure payment systems, and innovative logistics solutions have collectively transformed ecommerce into a vital economic pillar.

While challenges relating to regulation, costs, and digital inclusion remain, the trajectory of growth reflects a mature, expanding market with deepening consumer engagement and increasing competitive diversity.

As the sector evolves, its contributions to broader digital transformation and economic development will be central to South Africa’s economic strategy and regional leadership in digital commerce.

Leave a comment and follow us on social media for more tips: